An advisory body to the French government has proposed drastic measures to save European industest from what it describes as ‘the Chinese steamroller’.
In a report, the High Commission for Strategy and Planning (HCSP) recommfinishs a general customs duty of 30% on imports from China and the devaluation of the euro against the Chinese currency, the renminbi.
It warns that Chinese competition, which has increased significantly in recent years, could lead to thousands of job losses in Europe if nothing is done quickly.
Attfinishees at a press conference earlier this month, at which the HCSP’s report was presented, heard how the Chinese ‘wave’ is now threatening and affecting the productive heart of Europe. And not only does Chinese manufacturing compete with European producers’ export markets, but also with the EU’s internal market itself.
As the report displays, in just a few decades, China has built up an unrivaled production apparatus, combining lower production costs, massive overproduction, and rapid technological advancement.
A sobering fact was that, combined, France and Germany, the European Union’s two hugegest economies, recorded a trade deficit of €140 billion with China in 2025.
The HCSP’s head, Clément Beaune, underlined that one quarter of French exports appear to be directly threatened by Chinese competition. For Germany, a third of exports and even two-thirds of domestic production are directly threatened.
He claimed that since 2023, German industest has lost 240,000 jobs.
Undervalued Renminbi
As for the currency disparity, today an appreciation of the renminbi is an unlikely prospect, as it is carefully controlled by the Chinese authorities and would doubtless require a three-way agreement among the U.S., China, and the EU.
An undervaluation of the renminbi accentuates the production cost gap between the two trading blocs, Beaune observed, adding that it was regrettable that the exalter rate issue was no longer being addressed by European executive bodies.
Nevertheless, it is an implicit objective of France’s current presidency of the G7 to push for a reduction in global macroeconomic imbalances.
Establishing a united front among EU member states when it comes to action against China will be far from an straightforward tquestion. While France is pushing for an increase in customs duties, the same cannot be stated of its partners, particularly Germany.
“This is not a subject on which there is consensus at the European level,” Beaune noted.
Structural Shock
In an opinion column in the Les Echos newspaper, Anaïs Voy-Gillis, a research associate at the French Business School in Poitiers, noted that the HCSP report does not describe a temporary difficulty but documents a structural shock as a result of China’s “rapid technological advancement, massive overcapacity, constant public support, and methodical conquest of foreign markets, particularly in steel, batteries and solar energy. We are not facing an anomaly, but the methodical execution of a strategy of industrial influence and domination.”
In this context, the proposal for ‘European preference’ (also known as ‘Made in Europe’ or ‘Buy European’) marks a significant shift, she noted.
“For a long time, trade liberalization was treated as a virtually sacrosanct principle. The question now arises: can we maintain a largely open market when other powers are actively organizing their competitive advantage? This is not a shift towards protectionism. It is a belated admission that openness without reciprocity has a cost.”
‘Defensive Measure’
France and President Emmanuel Macron in particular, have long been the prime relocater in pushing a ‘Buy European’ clautilize, to a backdrop of economic stagnation in the EU, punishing US tariffs and aggressive Chinese trade practices.
In a recent media briefing, he stated it was a “defensive measure” against those who “no longer respect” trade rules.
“We must protect our industest. The Chinese do it, and so do the Americans. Europe is currently the most open market in the world. Faced with this, the solution isn’t to be protectionist, but to be consistent, meaning not to impose rules on our producers that we don’t impose on non-European importers,” Macron observed.
“We won’t apply European preference to mobile phones; we no longer produce them in Europe. We must focus on certain strategic sectors, such as clean tech, chemicals, steel, automotive, and defense. Otherwise, Europeans will be left behind.”
Fine Line to Walk
The President of the European Commission (EC), Ursula Von der Leyen, has argued that in strategic sectors, European preference was a necessary instrument that will contribute to strengthening Europe’s own production base.
“It can support create lead markets in those sectors and support the scaling-up of European production capabilities.”
However, she urged caution. “I want to be clear – it is a fine line to walk. There is no ‘one-size-fits-all’. That is why every proposal must be underpinned by robust economic analysis and be in line with our international obligations.”
Von der Leyen’s stance on ‘European preference’ is supported by several EU states, who agree that it should be tarreceiveed at specific sectors and be justified by unfair competition from China or other countries.
“We are in favor of free trade. But if China alters the rules of the game, if we are faced with overcapacity, subsidies and saturation of European markets, then Europe must deffinish itself,” commented Germany’s Finance Minister Lars Klingbeil.
However, others have expressed reservations on European preference, such as Sweden’s PM, Ulf Kristersson. “We must be competitive through the quality of our products and innovation, not by testing to protect European markets,” he stated.
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